Posted by: kenwbudd | February 26, 2011

Insurance Companies do noy pay out

My neighbour has parked his trailer outside our house filled with assorted discarded household items. 

I was initially disturbed by this but on enquiring I discovered they had been the victims of a watery deluge from a faulty appliance and their house now required extensive flooring replacement.

As if this was not troubled enough, on enquiring further I discovered that they had also fallen victim to a cynical insurance company’s determination not to pay out on claims.
The insurance company discovered a crack in the grouting in the bathroom tiles, on the second floor, whereby the water was allowed to escape to the lower floor. They claimed that this was the fault of the householder and the extensive damage to the flooring below was caused by their neglect and lack of maintenance.
I have to say that we live in an area that has excellent water pressure and that any leak quickly causes a small fountain to appear. Therefore, the water would have escaped down the stairs and caused the same damage had it not first taken a ‘shortcut.’
No amount of argument and protest would make the insurance company backdown and the next step would be taking expensive legal action against them, which my friends decided against. So the insurance companies win again in taking money in and not paying out.
It has been commonplace in the US that the companies do not payout on claims without the claimant taking out litigation against them, no matter how valid your claim is. In this way the companies avoid paying out on a very large number of cases and therefore increase their profit margins.
Most insurance companies now employ dedicated teams of people to discredit any and all claims against the company. These teams are paid bonuses based on how little they payout.
We have an increasing number of technologically advanced telephonic devices, which are increasingly expensive. Normal practice, when selling phone is to add a cost for loss or damage insurance but the ‘exclusion’ clauses in these policies make them very lucrative for the insurance provider and virtually useless for the user and payee.
The standard get-out is the ‘due care’ clause and that means if you do not take proper care to secure or keep your phone safe, then the coverage is null and void. So, if you leave your phone sitting on a café table and walk away, or it falls to the ground and breaks, or it is snatched out of your hand, or most other ways in which you can lose or damage a phone, these are deemed ‘lack of due care’ and the company will not payout.
Try to be clear when taking out insurance that you are buying the kind of coverage that you want and be very specific, in writing, in asking direct questions on specific items and or the circumstances that you want covered. You may need to pay extra on your premium but at least you know what you are paying for.
It makes no sense to pay out on insurance premiums year by year knowing that they will not payout when required. Better to put that money in a safe savings account and draw on it, when required. My neighbour is certainly considering changing his coverage provider or just not paying any insurance companies, knowing they will not payout, no matter what.
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